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Delhi Wine Club

Posted: Tuesday, August 14 2007. 11:00 AM

Retail Boom Boon for Wine Producers

A boom in the organised retail and the government policy of allowing the sale of wines through supermarkets will prove to be a boon for wine companies. Big players like Diageo, Champagne Indage and UB Group are tying-up with retail majors to gain adequate space for display and sale of their products.

Reliance Retail has reported entered into arrangements with Diageo, UB Group and Champagne Indage. other retailers like Shoprite and Future Group are also being approached by wine makers for similar pacts.

Industry players say a tie-up with big retailers will not only strengthen distribution network but also help in expanding the market by creating awareness of wine culture.

"By tying up with retail players we not only increase visibility of products but it will also help in creating awareness about wine-drinking in the country," Champagne Indage managing director Ranjit Chougule said.

He said in traditional wine shops, the average space given to wine segment is about 5-10 per cent and that too is shared between five to six players.

Echoing similar views, Diageo India managing director Asif Adil said: "Tie-up with retail players will give better results as it will synergies strengths of the two sectors."

Diageo-Radico chief executive Raju Vaziraney said the biggest advantage of selling wine through retail players is that it would help in getting proper display of products.

He, however, said there would not be a major increase in revenues from selling wine through organised retail. Moreover, wine makers are not yet replacing their existing distribution networks.

"Retail chains will give us the added advantage but will not act as alternative to the present selling pattern in the country," Vaziraney said.

http://economictimes.indiatimes.com

DelWine differs with Vaziraney. There is a huge latent demand that is pent up and waiting to be satisfied. Supermarkets are just the vehicle due to proper storage display, sales promotion and pricing due to volumes.

The irony is that imported wines would benefit more from this step as the Indian wines were generally available more easily anyway , though given a choice anyone would prefer the purchase from the supermarket.

To that extent, the existing sales channels will be hit badly. But overall, there will be a big boost-unless Maharashtra government continues to play the role of being the consumer’s khalnayak and decides to limit the sale of only Indian wines- or playing into the hands of the state producers, only Maharashtra wines -editor.

 
 

 
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